Money Manager & Credit Score

Is Life After Bankruptcy That Bad


It seems that some people do not recognize that dispite some unpleasant aftereffects, bankruptcy is truly a “fresh start.”

Instead of being satisfied with the benefits they receive some people remain unhappy.

Here is a letter I received:

“Why does it take attorney's six or more weeks to discharge a chapter 13?

Why do apartment leasers hold a bankruptcy against you when I don't see how you could add apartment rent onto your bankruptcy?

If life is so miserable after a bankruptcy, why are lawyers constantly telling people it's okay to file. (They want to get paid.) “

My response:

“Six weeks for a discharge isn't that long and may well be governed by the schedule of the bankruptcy court.

Some landlords may not want to rent to someone with bad credit. They may feel that they will have to chase the renter for their money. Dispossessions are time consuming and expensive.

In many cases the landlord will get possession of his apartment, but may never recover the unpaid rent.

While the court proceedings drag on, the landlord has lost a part of his source of income. So he haa a right to be careful.

However life is not that bad after bankruptcy. Debtors used to be sent to jail.

Not too long ago, bankruptcy would mean that the bankrupts would have to carry a stigma for life. Many committed suicide rather than face the disgrace.

Many people who went bankrupt during the Great Depression spent years paying off their discharged debts as a matter of honor.

Now nobody much cares. You will be able to get credit. Your debts have been wiped away. What more can you ask for?

You were the one who ran up the debts, whether through bad luck, bad planning or the simple inability to control your spending.

You did contract to repay the money and you didn't.

For the most part you are now free of the pain and pressure caused by your financial problems. You will face some obstacles over the next few years, but you should have realized that before filing.

You approached a lawyer, not the other way around. I'm sure the lawyer didn't twist your arm to force you to file. If you've gotten your discharge, be happy, restart your life and live with the consequences.

Things could be worse.”

In my opinion this person needs an attitude adjustment.

Money is About Life Life is About Mastering Money


Too often we get caught up in our lives to worry about finances. The problem is that finances are in many cases why our lives are so hectic. This phenomenon is all too common. I say "we" because I face the very same difficulties - even though I am a financial advisor.

I like most people would like to live a life where someone else did the things around the house and at the office that I don't want to do, I would like to be able to spend time at an emotionally meaningful and challenging profession, I would like to spend time with my wife and kids, and I would like some down time to do whatever I opt to do.

Given these financial goals I often wonder what I (and my clients) are doing to work towards those goals. I (and most of my clients) spend a lot of time around the house and office doing things I (we) don't want to do. I find excuses for not hiring someone to do those things.

Instead of focusing my energies at work on things that are emotionally meaningful (such as stewarding money towards charitable causes) and challenging (such as structuring complex partnership agreements), I tend to spend my days pushing paperwork and setting up accounts. Yet, I have spent very little time thinking about how to remedy this situation. When I start thinking about these issues, I often make excuses (such as "if I want it done right, I have to do it myself").

I spend a lot of hours in the office and even when I am at home I end up doing tasks that are away from my wife and children (such as mowing the lawn or repairing a leaky faucet). I could easily hire this type of work out, but somehow I always end up just doing it myself.

I have a lot of interests, such as coaching my son's soccer team, reading classic literature (especially 18th century thrillers), and restoring old run down Volvos. Other than the coaching, I never seem to find time to do these things that I enjoy.

At this point you might be thinking, "so what does that have to do with finances?" The answer is that it has everything to do with finances. Each decision is predicated on either earning more money or spending less money. That is the rub. The dirty secret that is all too taboo in our society. Money, if used properly, can in fact make your life better.

In all of the financial advice I give my clients, one message remains the same: your money is your happiness. Secure your money and you will secure your life. Of course this advice means different things to different people. The "do-it-yourselfer" may read this to mean that they should be frugal and save every penny, to have a brighter tomorrow. The "fly-by-the-seat-of-your-pants" kind of person might read it to mean that they should spend everything to have a brighter today.

Luckily they are both right. Each individual can and should examine what is important to them. They should set out (I mean by actually writing it down) a plan in light of what is important to them. They should take steps over time to fully implement that plan and they should review the plan periodically to ensure that they are still pursuing goals that are important to them. This is what I teach clients and this is what I try to implement in my own life.

I spend more time at home with my family and I hire rather than do some things myself. In short I force myself to do what is not what I would normally do. After exploring my (and my wife's) goals, that was what was important to us. Having made a lot of progress towards these goals, I can tell you that my life is a thousand times better today than when I started. I fully expect it to be a thousand times greater in the future.

This is what true financial planning is all about. If you have not explored your goals, I urge you to do so now. If you haven't met with a financial professional to discuss your goals, I urge you to do so today. Once you start making progress towards your goals, you will wonder why you didn't do so sooner.

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